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Expectations soar as tobacco sales start

Expectations are high among Malawi’s tobacco growers as this year’s marketing season opens Monday.

Tobacco Control Commission (TCC) chief executive officer Dr Bruce Munthali said on Monday government has approved March 26, March 28, April 2 and April 16 as tentative dates for starting tobacco sales at Lilongwe, Limbe, Chinkhoma and Mzuzu auction floors.

Interviews conducted by Business News in Phalombe on Saturday indicated that growers are optimistic about better prices on the market due to a significant fall in supply as some farmers opted for other crops following poor prices on the market last year.

According to TCC, Malawi is expected to have 151.5 million kgs of tobacco this year against 237.171 kgs realised in 2011, representing a 36 percent drop.

The country’s international buyers are looking for between 150  and 160 million kgs.

Experience has shown that a suppressed crop volume always triggers a scramble for the leaf at the floors, resulting in better prices. Similarly, a jump production results in poor prices.

One of the growers, Anthony Julius, said he expects better prices this year than last year.

“Many of my friends have not grown the crop this year because of poor prices and lengthy selling season last year.

“From what I am gathering, not many people have grown the crop this year. So I have high hopes that we will get better prices this year,” said Julius.

Another grower Andrew Magodi agreed with Julius that they have high expectations from this year’s market.

But Munthali could not comment on the link between the low production levels and prices, arguing he does not like to speculate.

As the tobacco markets open next week, farmers will not be the only group keeping its fingers crossed.

Minister of Finance and Development Planning Dr Ken Lipenga and President Bingu wa Mutharika will keep a close eye on the proceedings of the market as they attempt to raise enough forex to arrest the economic challenges that have engulfed the country in recent months.

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